MFM vs SCHD
MFS Municipal Income Trust vs Schwab US Dividend Equity ETF
Quick Verdict
SCHD has a lower expense ratio. SCHD delivered stronger 1-year returns. MFM offers more diversification with 263 holdings.
Side-by-Side Comparison
| Metric | MFM | SCHD | Winner |
|---|---|---|---|
| Expense Ratio | 1.45% | 0.06% | |
| AUM | $250M | $103.7B | |
| Dividend Yield | 5.25% | 3.31% | |
| Holdings | 840 | 104 | |
| YTD Return | +3.73% | +25.33% | |
| 1Y Return | +11.06% | +32.31% | |
| 3Y Return (annualized) | +7.03% | +15.40% | |
| 5Y Return (annualized) | -1.28% | +9.70% | |
| Volatility (annualized) | 14.1% | 13.6% | |
| Max Drawdown | -64.8% | -33.4% | |
| Fund Family | MFS Investment Management | Charles Schwab Asset Management | |
| Category | Tax Preferred | Equity | |
| Inception | Nov 25, 1986 | Oct 20, 2011 |
MFM vs SCHD Performance
MFS Municipal Income Trust (MFM) is a ETF from MFS Investment Management and Schwab US Dividend Equity ETF (SCHD) is a ETF from Charles Schwab Asset Management. Over the past year MFM returned +11.06% while SCHD returned +32.31%. Year to date, MFM is up 3.73% versus a gain of 25.33% for SCHD.
Over three years, MFM compounded at +7.03% per year against +15.40% for SCHD; over five years the annualized figures are -1.28% and +9.70% respectively. Across the full 15-year window we track, SCHD has the edge at +11.45% annualized vs -1.06%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
MFM has been the more volatile fund, with annualized monthly volatility of 14.1% compared with 13.6% for SCHD. Lower volatility generally means a smoother ride, though it often comes with lower long-run returns.
The deepest peak-to-trough decline in our data was -64.8% for MFM and -33.4% for SCHD. Drawdown depth is worth weighing if you expect to sell during market stress rather than ride it out.
The two funds' monthly returns correlate at 0.37. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
MFM charges 1.45% per year while SCHD charges 0.06%. On a $10,000 position that is $145 vs $6 annually, a gap of $139 per year that compounds over a long holding period. On income, MFM currently yields 5.25% against 3.31% for SCHD.
Holdings Overlap
MFM and SCHD share 0 holdings out of 363 unique holdings combined, representing a 0.0% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, MFM or SCHD?
MFM has an expense ratio of 1.45% while SCHD charges 0.06%. SCHD is the cheaper option. On a $10,000 investment, that is $139 per year of difference.
Which performed better, MFM or SCHD?
Over the past year MFM returned +11.06% vs +32.31% for SCHD, so SCHD leads on 1-year performance. Over the longest common window we track (15 years), MFM annualized -1.06% vs +11.45% for SCHD. Past performance does not guarantee future results.
Which is riskier, MFM or SCHD?
MFM has been the more volatile fund at 14.1% annualized versus 13.6% for SCHD. Worst drawdown: MFM -64.8% vs SCHD -33.4%.
Should I hold both MFM and SCHD?
MFM and SCHD have a monthly-return correlation of 0.37, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between MFM and SCHD?
MFM and SCHD share 0 common holdings with a 0.0% weight overlap. Combined, they hold 363 unique securities.
Which pays a higher dividend, MFM or SCHD?
MFM yields 5.25% while SCHD yields 3.31%, so MFM currently pays the higher dividend yield.
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